Originally posted on the Broadcast Law Blog
To move or not to move? For broadcasters considering a change in a station’s community of license, this question now requires a bit more forethought. There may be unintended consequences for broadcasters that request a community of license change based on tenuous future plans. In a recent letter decision, the Commission’s staff reminded an applicant that upon receiving a final Commission decision to change the commercial FM radio station’s community of license, it traded in its license for an ‘implied STA’ to continue operating its station with its existing licensed facilities. In other words, the existing facilities would no longer receive contour protection from other stations and technical proposals that they wanted to make through modifications or other applications. The FCC staff stated that the applicant who had received authority to change city of license was obligated to construct its stations at the new community. Furthermore, the Commission could cancel the implied STA, requiring the station to cease operations, if the existing facilities continue to impede construction of any approved third party modifications. According to the Commission, a request to change a community of license carried with it an implied certification that the applicant is ‘ready, willing and able’ to construct and operate the facility. Because the applicant who changed city of license in this case did so through a modification of the FM Table of Allotments rather than through a one-step application (which was not available to make the change they requested at the time they first sought the city of license modification), this decision leaves us with many questions, but certainly warns applicants for city of license changes that they must consider their plans carefully.
The facts in this case began in 2003 when, as part of a rulemaking proceeding, the FCC issued a Report and Order modifying the KIKT(FM) community of license from Greenville, Texas to Cooper, Texas and later that year granted a construction permit to implement the same. Immediately prior to expiration of the construction permit in 2006, its licensee re-filed for identical facilities, and did so again immediately prior to the 2009 expiration date. The Commission granted the licensee a total of three construction permits for the same facilities in Cooper, Texas. Meanwhile, another broadcaster filed an application to improve the facilities of its station KNOR(FM) - an upgrade that was mutually exclusive with the existing KIKT(FM) facilities at Greenville. Therefore, the Commission’s approval of the KNOR(FM) upgrade contained a special operating condition requiring KIKT(FM) to initiate operations at Cooper, Texas before KNOR(FM) could implement its upgrade. After what amounted to three, three-year extensions, the KNOR licensee petitioned the Commission for the condition to be removed and KIKT(FM) be forced to make its move to Cooper, Texas. The Commission agreed, finding that, despite the fact that allowing KNOR(FM) to implement its upgrade would result in interference to KIKT(FM)’s existing facilities, the Commission decided that it was in the public interest to remove the special operating condition at issue. However, the Commission denied the request to cancel the implied STA, and instead threatened to cancel the implied STA if KIKT(FM) isn’t constructed at Cooper on or before the current construction permit deadline in 2012.
The Commission’s decision adds a wrinkle to the commonly held understanding that a broadcast applicant won’t be forced to build facilities authorized by a construction permit and can surrender a construction permit with no penalty. Now broadcasters need to seriously consider the viability of any proposed community of license changes, lest they unintentionally abandon the licensed facilities. But there are several facts that were present in this case and we can’t be sure just how pivotal they were to the outcome. For instance, the KIKT(FM) community of license change was part of a rulemaking proceeding. Now that community of license changes have been streamlined and, in most cases, do not need a rulemaking but can be requested as minor change applications, it remains to be seen whether this decision would apply with equal force in that context. And, if there is no competing facility, will the Commission nevertheless mandate construction of these community of license changes, even if the permittee decides, after the permit is granted, that its plans have changed? Is it in the public interest to force construction if there is no mutually exclusive modification or proposal lying in wait? What happens in the noncommercial context where there is no Table of Allotments, so there is no placeholder for the new community of license? This case presented a set of polarized facts, that some might say could only result in the decision that the Commission’s staff reached. Warehousing spectrum for six years is clearly not in the public interest, especially when it obstructs implementation of a new proposal. But given the questions raised above, we can’t be certain how this decision would be applied to different facts. Nevertheless, this case serves as an indicator to broadcasters about where the Commission is headed as it relates to community of license changes, and a cautionary tale to those hasty to make moves without understanding the implications. Make such proposals seriously, as you may be forced to build what you promised even if your plans later change.